Panama Papers in Wyoming

Panama Papers’ Company “Active” and In “Good Standing” In Wyoming

The documents from the Panamanian law firm Mossack Fonseca disclosing Wyoming’s disgraceful role in assisting tax evasion, fraud and corruption on a global scale should be a wake up call to Wyoming’s Secretary of State. It was in the Wyoming Secretary of State’s office where Mossack Fonseca registered its company “MF Corporate Services Wyoming LLC.” According to the deposition testimony of a Mossack Fonseca employee in 2014, Wyoming was “just another product” that the firm could offer to its clients who were trying to hide their money from tax authorities.

But Mossack Fonseca is no longer the primary problem — it is now dead as a money laundering operation. As Bloomberg News reported, the bigger problem is that the United States, with Wyoming’s help, has become the world’s tax haven of choice. The Sueddeustche Zeitung, the German newspaper that first received the Panama Papers from an as yet unidentified source, stated that there are no American politicians listed as clients of Mossack Fonseca. A New York Times’ article noted that Americans don’t need to go to Panama to hide money – they can set up shell companies with undisclosed beneficial owners in Wyoming or Nevada.

A centerpiece of my campaign for Secretary of State in 2014 was to shut down Wyoming’s practice of allowing tens of thousands of people to anonymously register shell companies as Wyoming businesses when they have no legitimate business ties to Wyoming. My proposal was to require, in exchange for the limited liability that a Wyoming corporation or limited liability company provides, that those business that did not own property in Wyoming or otherwise do business here be required to disclose who the real beneficial owners of the companies are.

My proposal was met with a mixture of denial and disinterest. The outgoing Secretary of State put out the line that the problem had already been solved. The Casper Star Tribune bought that hook, line and sinker, its editorial board politely characterizing my candidacy for Secretary of State as being “too narrow” on the issues. Apparently, Wyoming’s role in helping bad actors hide money at the rate of $1.6 trillion per year for a total of between $21 and $32 trillion hidden worldwide, as estimated by the World Bank, was too small an issue for a Wyoming Secretary of State candidate to worry about.

Wyoming’s academia was similarly disinterested. A University of Wyoming political science professor interviewed about the Secretary of State race in 2014 mused that maybe the candidates wanted the job because the office was so sleepy, with nothing going on: “it’s not very stressful if they just left things alone and don’t stir up the pot.” When I presented the problem of shell companies to the editorial board of the Wyoming Tribune Eagle, my audience responded with expressions ranging somewhere between yawn and deer-in-headlights puzzlement.

It will not be enough for the Secretary of State to simply shut down Mossack Fonseca in Cheyenne. The Secretary of State needs to take real action to remove the stain from Wyoming’s reputation. Wyoming’s good name should not be “just another product” traded by tax evaders.